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//Amazon.com – Customer Management Process

Amazon.com – Customer Management Process


1 Customer Management Process

Amazon became an art of state for E-Commerce, occupying the first place ahead of JD and Alibaba, and with greater positions a greater responsibility comes along, to retain the users and build better customer relations.

1.1 CRM

Amazon built a successful CRM which enabled them to serve the customers without the need for human interference at most, the bias for automating the process was tailored based on the most frequent scenarios, starting from data collection, frequent and recommended products, UX for each user and expanded to cover functions like Incident management; problem management, order management; contract management, dispatching; real-time information transfer (Expert Market, n.d.).

1.2 Competitive Customer Service Standard

Apart from the CRM system, Amazon implemented all the regular and standard support solutions, such as FAQ, Live Chat, Ticket Center, Live Chat, or Hot Line for assistance, and the greatness came in that all of them integrated and can be assisted across different channels (Al Imran, 2014).

1.3 Customer Service Value

Amazon stated clearly that their main values of Customer Service are to drive new business opportunities, increase customer life value (CLV), and increase customer retention, and they initiated a department under the name of Amazon Incentives to serve these values (Amazon.com, n.d.).

2 Customer Management Strategies

Jeff’s main vision of Amazon were limitless inventory, Customer Care, and High Margin and Lowest cost, give the customers the care and attention they need and they will be your business generator, and Amazon could do that through relying on word of mouth.

2.1 Strategies Key Points

  1. Protect the relation, where they consider it the most valuable resource.
  2. Grow the relationship, through several upselling and cross-selling techniques, Amazon could make some users addicted to online purchase.
  3. Winning Back the customers, especially those who went for rivals such as eBay or Chinese websites, especially U.S. residents notice the high activity to pull them back after long time of inactivity (Moz, 2018).

Figure 1: Sketch by Amazon’s CEO explaining the continous improving for growth and customer experience. (Practicalecommerce.com, 2017)

3 Obstacles of Marketing Strategy

By analysing the mix marketing strategy for Amazon, we can see they had a robust communicate with the target market, the mixture of promotional practices they followed varying from advertising, sales promotions, direct sales, or PR, all enabled to widen the company’s reach (FERGUSON, 2017).

3.1 Challenges of the Marketing

As experts saying (2015), that marketing was not the main factor of Amazon success, it was the scale of their operations where none of the competitors could, not even Alibaba which tell today have some geographical boundaries, but it was how to market their market competitive, and attract them to their new products such as Prime, AWS, Alexa and others, with retaining the brand identity (McKevitt, 2016).

Figure 2: Up to date list for Amazon Produts (Mintrest.com, 2018)

3.2 Resistance from the community

Over the time capturing customers’ data was essential to serve them better, target them, and to enable remarketing, however with the raise of the volume of captured data, or the lended from data providers, users showed a level of caution of providing their personal data, which turns to be an obstacle of introducing new technologies, or rescale it, rather than market it from the from place such as AmazonGo (Chaffey, 2018)

Figure 3: Amazon’s shares declined after rumors of getting involved with data purchase from Cambrdige Analytica during Facebook’s accusation of data breach (Businessinsider.com, 2018)

4 Alliance Strategy

They used to say “If you can’t beat them, work with them”, but Amazon had different opinion instead to acquire them, Amazon started to reshape their vision to be “The Everything Store”.

4.1 Strategic acqusitions

It is clear through the recent acquision that the company seeking the best in their field, or their region to add them to their family (Desjardins, 2018), let’s take different examples:

  • Audible: Amazon started their ebooks business Kindle and owning the audiobook leader is indeed a great added value.
  • Twitch: The number one destination for gamers live streaming, and main channel for eSports competition, definetly good competitor for Google’s rival Youtube Games.
  • Souq.com: Expanding into the Middle East required twime to invest into their infrastructure, instead they simply acquired the e-commerce leader website.
  • WholeFoodsMarket: The biggest acqusition recorded yet for Amazon, where they could expand the independence of the participants, and simply allowing buying grocery online never been easier

Figure 4: List of Amazon’s acqutisions before WFM (Techcrunch.com, 2017)

4.2 Oraganisational Structure with Alliances

You do not go for the best and teach them how to do their work, the established relationship between Amazon and partners were just empowering their resources, and enabling the technology into their operations, which could maximise the benefit for both partiess (Palmquist, 2014).

5 Amazon CSR initiatives

Unlike Microsoft, Amazon was not well known for their contribution in the society, in fact they have scored 25 out of 100 ESG ranking in comparison for 98 out of 100 for the first (CSRHub, 2018). Also they do not disclose about their contributions or participants in reports, just a media press and statements which make it a bit.

5.1 Corporate Responsibility

At the beginning of 2018, customers of Amazon Prime noticed a different packaging, and later at CR magazine review they reported that Amazon moving towards a sustainable packaging, renewable energy, and eco-friendly practices, yet it was not very clear whether it was really a move to cut cost, especially they reported that the loss of packages of at least $1.6 trillion worldwide (3p Editors, 2018).

5.2 Amazon Initiatives

The greatest on official records by the annual report for Amazon, was the initiatives towards the nations, like feeding homeless people in America, public libraries for African countries, running donation campaigns or empowering workers (Dudovskiy, 2018), yet there was lack of resources to track those intitiaves or captured the actual results.

Figure 5: Amazon Smile is an intitiave donate portion of the profit to charity (Community Crunch, 2018)

* NOTE: This research published within Master study for London School for Business and Finance.

** Published in LinkedIn Pulse: https://www.linkedin.com/pulse/amazoncom-customer-management-process-sadeq-jaafar/

6 References

  • Al Imran, M. (2014). A STUDY ON AMAZON: INFORMATION SYSTEMS, BUSINESS STRATEGIES AND e-CRM. Research Gate, (1), p.6.
  • Amazon.com. (n.d.). Customer Loyalty Programs – Gift Cards for Customer Rewards and More. [online] Available at: https://www.amazon.com/customer-rewards-program/b?ie=UTF8&node=15243196011 [Accessed 19 Oct. 2018].
  • Chaffey, D. (2018). Amazon.com case study – 2018 update | Smart Insights. [online] Smart Insights. Available at: https://www.smartinsights.com/digital-marketing-strategy/online-business-revenue-models/amazon-case-study/ [Accessed 21 Oct. 2018].
  • CSRHub – Sustainability and Corporate Social Responsiblity (CSR) ratings on over 18,424 of the world’s largest public and private companies. (2018). CSR information for Amazon.com, Inc.. [online] Available at: https://www.csrhub.com/CSR_and_sustainability_information/Amazoncom-Inc [Accessed 19 Oct. 2018].
  • Desjardins, J. (2018). INFOGRAPHIC: Amazon’s biggest acquisitions. [online] Business Insider. Available at: https://www.businessinsider.com/amazon-stock-price-biggest-acquisitions-infographic-2017-9 [Accessed 21 Oct. 2018].
  • Dudovskiy, J. (2018). Amazon Corporate Social Responsibility: a brief overview – Research-Methodology. [online] Research-Methodology. Available at: https://research-methodology.net/amazon-corporate-social-responsibility/ [Accessed 19 Oct. 2018].
  • Editors, 3. (2018). Unpacking Corporate Responsibility at Amazon. [online] Triple Pundit: People, Planet, Profit. Available at: https://www.triplepundit.com/2018/03/unpacking-corporate-responsibility-amazon/ [Accessed 19 Oct. 2018].
  • Expert Market. (n.d.). Amazon CRM Case Study. [online] Available at: https://www.expertmarket.co.uk/crm-systems/amazon-crm-case-study? [Accessed 19 Oct. 2018].
  • FERGUSON, E. (2017). Amazon.com Inc.’s Marketing Mix (4Ps) Analysis – Panmore Institute. [online] Panmore Institute. Available at: http://panmore.com/amazon-com-inc-marketing-mix-4ps-analysis [Accessed 21 Oct. 2018].
  • Hobbs, T. (2016). Amazon at 20: The brand, the challenges and the future – Marketing Week. [online] Marketing Week. Available at: https://www.marketingweek.com/2015/07/15/marketing-isnt-the-reason-amazon-is-successful-experts-say/ [Accessed 21 Oct. 2018].
  • McKevitt, F. (2016). Five challenges Amazon faces plotting its own-brand products. [online] Cityam.com. Available at: http://www.cityam.com/241239/five-challenges-amazon-faces-plotting-its-own-brand-products [Accessed 21 Oct. 2018].
  • Moz. (2018). How to Win Some Local Customers Back from Amazon this Holiday Season. [online] Available at: https://moz.com/blog/win-local-customers-back-from-amazon [Accessed 19 Oct. 2018].
  • Palmquist, M. (2014). The Amazon Model: If You Can’t Beat ’Em, Work with ’Em. [online] strategy+business. Available at: https://www.strategy-business.com/blog/The-Amazon-Model-If-You-Cant-Beat-Em-Work-with-Em?gko=d33d3 [Accessed 21 Oct. 2018].
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